Commercial fundraisers: Read before you give

Commercial fundraisers collected $338.5 million for California charities in 2011. The charities' share of that haul: $172.8 million, or 51 percent.

That's an improvement over 2010, when charities got just 44 percent of what was raised in their name by paid fundraisers, California Attorney General Kamala Harris says in a new report.

Most charities raise the vast majority of their money in other ways — through traditional in-house fundraising, memberships or fees for services at nonprofit colleges, art galleries or hospitals. Established charities that use paid fundraisers typically do so to fill in gaps in their business plans.

However, a handful, like the infamous Santa Ana-based Association for Firefighters and Paramedics, depend exclusively on paid fundraisers who take almost all of the money they raise. (Keep reading for tips on how to find the most reputable charities.)

The AFP paid $100,000 in 2010 to settle a lawsuit by then-Attorney General Jerry Brown, who said board members had diverted $33,000 for meetings in San Diego and Las Vegas plus a Caribbean cruise for board members and their families. AFP says it raises money for survivors of catastrophic fires.

In 2011, its first full year under the settlement, AFP reported raising $258,211 and netting $28,399 in California — an 11 percent return.

We called AFP Executive Director Michael Gamboa, but our conversation was brief:

"I have no interest in speaking with you," he said.

AFP is the last survivor in Orange County of a once-thriving group that raised tens of millions of dollars each year through phone solicitations nationwide. The group was founded by Mitch Gold, who lived large — Jaguar, Ferrari Testarossa, hilltop home in San Juan Capistrano — until he was sentenced to federal prison for fraud in 2001.

Gold's right-hand man, disbarred attorney, convicted felon and failed parricide Joe Shambaugh, set up four charities in Orange County early in the last decade. The Federal Trade Commission shut down three of them in 2009 for misleading donors after a fourth had closed.

Shambaugh is scheduled to be sentenced to five to 10 years in prison on Dec. 21 on his guilty plea to wire fraud for misleading donors in the charities' solicitations.

For most charities, commercial fundraising is a tiny slice of their money-making operation.

Friends of Santa Ana Zoo, like many membership groups, has a chronic problem getting members to renew. Just 30 percent of its 6,000 members renew each year.

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